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I totally agree with what Tom said here. If he pushes you into something you know is not correct this year, he will continue to push in the future.

This is why TT hires EA's and CPA's to assist DIY clients in preparing their TR's. Clients pay additional fees for phone line help. If he doesn't want to play by your rules, send him back to TT.

If you don't set the ground rules for the engagement this year, you will regret it. Personally, I would tell the client that it is not your practice to produce incorrect tax returns, that it is his choice to correct the prior years, but if he does not, you cannot produce a correct return this year because the carryforwards are incorrect and you will not sign a return you know to be wrong. Make him make the choice to stay or go. Tom Longview, TX

To answer your question, I vote for firing him. With the work involved and his realization that he will need to correct and pay tax he will probably give you a hard time when he gets your fee. End it now, you will feel better.

And, with his "simple" pricing adjusted for the 3115 and for his time suck to you of being a PITA.

The only way I would prepare this return is with a 3115 correcting the depreciation which would give him a 4 year forward spread on paying the additional tax. I would clearly state that in an email and as Tom says," Make him make the choice to stay or go."

New client with ‘easy’ return is becoming a PITA. Been using TurboTax and hired me because this year he bought out his partner on a duplex they owned. Lived in one half, rented the other. So I’m inputting the depreciable assets, and I notice that the rental half is $368,000 with $100,000 for land. The duplex was bought for $930,000. It seems to me he is depreciating the entire rental unit and not just his half. When I asked him about it, he said “I just followed what TurboTax told me to do”. It seems the first two years The whole property was rented. I guess TurboTax didn’t ask about taking it out of use. Or he didn’t understand what they were asking. So there’s only 6 years of over depreciation. He’s starting to push back on correcting the depreciation. He keeps insisting his return was ‘easy’. So do I fire him? I just sent a stern email.

One benefit to including the health insurance amounts in the wages (as you're suppose to do anyways) is that is helps fulfil the reasonable compensation requirement. With health insurance as high as it is, it's a nice chunk of the reasonable comp being covered and it's not subject to FICA. WIN-WIN.

Talked to Drake: clueless, and suggested trying to resubmit but of course the software won't let me. Brief call to GA DOR tax pro hotline: "we are aware of the problem and are behind in processing. Please have patience with us as we try to catch up." At least now I know that the problem isn't on my end, with the software, or with IRS transmitting to the state.

"Consider the Option to Just Prepare the Forms Advisers may wish to consider the other alternative to qualifying the S corporation to meet either the Domestic Filing Exception or the Form 1116 Exemption Exception—just preparing the Schedules K-2 and K-3 for an S corporation with only domestic activities. *Several professional tax software publishers have added the option to check a box that tells the software that the entity has only United States operations. When the box is checked the software uses the information entered on the forms to complete the rest of the Form 1120-S to populate Parts II and III of Schedules K-2 and K-3 based on the normal allocation information for profits and losses for the return, as well as the average book value for assets reported on the corporation’s depreciation schedule. For many simple S corporations, this procedure will produce either a correct Schedule K-2 and K-3, or a starting point for quickly creating proper Schedules K-2 and K-3 for the corporation. In that case, taking the additional steps to meet the requirements to meet either exceptions may consume far more professional time than simply preparing these forms for filing with the Form 1120-S and providing the appropriate Schedule K-3 to each shareholder."

I learned last year that if you do a print preview and print from the preview, it fixes the problem with 1120S & 1065 basis worksheets not printing. I'd try that first, whenever you have a printing issue.

Haha, so simple. I checked the sections for tax pros and e-filing. Thanks again.

If he's married, check if this might be a situation where MFS has better results.

Either he agrees to correcting the depreciation using Form 3115, or he can go back and cry to Ttx. I understand reluctance, but he's pushing into wanting to cheat because he sees it as troublesome and possibly expensive to be honest. Dishonesty is always too expensive for me ever to work with.

Check state requirements. MA requires filing the 990-EZ with the MA Public Charities Report, so there is NO Massachusetts nonprofit that can escape the EZ. The few non-profits I've dealt with we've filed the EZ since it had to be prepared for the state.

No, start with the 990-N. You can spend some time in the off-season looking over the 990-EZ, no need to torture yourself now.

3115 charges as a separate line item too with the explanation that that is the cost of his choosing to not hire a professional in the first place and/or using TurboTax incorrectly. That's assuming you think you can train him to be a worthwhile client, otherwise dump him now without wasting any more time.